U.S. slaps duties on China wind towers, high-level talks begin

Reuters News

12/18/2012 4:20:38 PM - Reuters News

By Doug Palmer

WASHINGTON (Reuters) - The United States pressed forward on Tuesday with plans to slap steep punitive duties on wind turbine towers imported from China at prices deemed unfairly low, even as officials welcomed a high-level Chinese delegation for trade and economic talks.

The Commerce Department set final anti-dumping duties ranging from 44.99 to 70.63 percent on utility-scale towers manufactured in China and additional countervailing duties of 21.86 to 34.81 percent to combat Chinese government subsidies.

The department also slapped final anti-dumping duties of 51.40 to 58.49 percent on wind towers from Vietnam.

A U.S. trade panel has final approval over the duties and is expected to vote on the case in late January.

The action was the latest clash between the two countries over U.S. imports of green technology from China. It came as a Chinese delegation led by Vice Premier Wang Qishan was in Washington for the U.S.-China Joint Commission on Commerce and Trade meeting, a high-level bilateral forum to address barriers to trade and investment.

Wang attended a dinner on Tuesday evening hosted by U.S. Trade Representative Ron Kirk and Acting Commerce Secretary Rebecca Blank and is expected to meet with U.S. Treasury Secretary Timothy Geithner on Thursday morning.

CHINA EYES U.S. "FISCAL CLIFF"

The main meeting on Wednesday takes place as President Barack Obama and House of Representatives Speaker John Boehner try to negotiate a budget deal to avert the so-called "fiscal cliff" of automatic tax increases and spending cuts early next year.

The White House is also pushing for an increase in the nation's $16.4 trillion statutory debt cap as part of any deal. The U.S. Treasury expects to reach the debt ceiling by year-end and will likely run out of options to free up more borrowing capacity by sometime in February, risking a potential default.

China is the United States' largest creditor, giving it a deep interest in Washington's budget debate.

U.S. companies expect Wednesday's meeting to produce no sweeping new commitments, but hope for action on concerns ranging from Chinese barriers to U.S. farm products to policies pressuring U.S. companies seeking business in China to transfer valuable technology there.

The U.S. Chamber of Commerce on Tuesday urged securities market regulators in both countries to resolve differences over sharing of confidential business information that China considers a state secret.

"Failure to reach an agreement will create regulatory dead-zones that harm investors and businesses. Furthermore, the threat of retaliatory actions by regulators, on both sides of the Pacific, may create a regulatory protectionism that will harm both economies," the business group said in a letter to the heads of the U.S. Securities and Exchange Commission and the China Securities Regulatory Commission.

The United States has also slapped anti-dumping and countervailing duties on billions of dollars of solar panels from China, despite strong objections from Beijing.

In Geneva on Tuesday, China's Ambassador to the World Trade Organization Yi Xiaozhun, criticized what he called U.S. "abuse" of anti-dumping and countervailing laws and accused Washington of blocking some Chinese investment in the United States for "ideological reasons."

LOST MARKET SHARE

The United States imported $222 million of wind towers from China last year and about $79 million from Vietnam. The custom-built steel towers support turbines that generate electricity from wind.

Chinese Foreign Ministry spokeswoman Hua Chunying, speaking at a daily news briefing in Beijing, said trade protectionism such as the wind towers issue would hurt bilateral cooperation and the interests of the United States.

"We hope the two sides can fully make use of the current bilateral dialogue and cooperation mechanism to resolve the relevant trade disputes through dialogue," Hua said.

Anti-dumping duties announced on Tuesday were higher for two Chinese companies, Chengxi Shipyard Co. and Titan Wind Energy (Suzhou), than the preliminary rates they received this year in the range of 20 to 30 percent.

Three other Chinese exporters also faced higher duty rates of about 45 to 50 percent in the final decision, but the top rate of 70.63 percent for "all other" Chinese manufacturers and exporters was down slightly from the preliminary level.

Final countervailing duties on Chinese wind towers were higher than the preliminary rates of 13.74 to 26.00 percent.

Final anti-dumping duties on Vietnamese towers were only slightly changed from preliminary levels.

The U.S. International Trade Commission has the final decision on duties. In February, the panel made a preliminary vote of 5-0 that there was a reasonable indication Chinese and Vietnamese imports have harmed U.S. wind tower producers.

U.S. producers say low-priced towers from Asia have cut into their market share and forced plant closings.

"Over the last years, in a period of peak demand, the U.S. industry should have been profitable," said Alan Price, an attorney at Wiley Rein representing U.S. producers. "Instead, due to the surge in dumped and subsidized imports, the industry lost market share and saw its profits collapse."

(Additional reporting by Sui-Lee Wee in BEIJING; Editing by Dan Grebler and David Gregorio)